Austria is probably confronted before the third year of the recession: the Austrian National Bank (OENB) has considerably reduced its growth stocks before 2025. And there is also bad news about the state budget. For this year, a slight decrease in the gross domestic product (GDP) is now expected by 0.1 percent.
For the next two years 2026 and 2027, the National Bank has also ruined its business predictions. It now expects the growth of 1.2 percent for both years. With its assessment, the National Bank is currently more on the pessimistic side. In December 2024, the OENB still expected GDP growth of 0.8 percent.
“The low point of economic development has probably been overcome,” says Oenb governor Robert Holzmann. Although the predictions are worse, the OENB expects the economy to be stabilized again this year. Because inflation is constant and the falling interest rates reduce cost pressure for companies and households. However, growth is only expected from the second half of the year, so the prediction for the year remains somewhat negative.
Budget deficiency too high
The OENB has bad news about the state budget: despite the savings efforts of the new black-rink-pink federal government, the National Bank does not expect the deficiency this year under the Maastricht limit of three percent.
Before 2025, the Central Bank expects a budget deficit of 3.8 percent. The OENB estimates the consolidation volume of the planned savings package for 2025 only to EUR 4 billion, and the government had promised a volume of EUR 6.4 billion.
HPVI inflation of 2.9 percent expected
The OENB also expects prices 2025. It expects an EU-wide harmonized inflation percentage of 2.9 percent. The considerably increased energy taxation at the beginning of the year – because some state aid measures have expired – and the aforementioned rising service prices increase the prediction for 2025. For 2026, a decrease in inflation is expected to 2.3 percent
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
